UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2014

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission File No. 0001510891

India Ecommerce Corporation

(Exact name of registrant as specified in its charter)

(412) 450-0028  

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to section 12(g) of the Act:

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

☐ Yes           ý No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.

☐ Yes           ý No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

ý Yes           ☐ No

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

ý Yes           ☐ No (Not required)

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).  ☐Yes   ýNo

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter:  $429,866 as of June 30, 2014.

Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date: 50,079,156 shares of common stock as of April 15, 2015.

DOCUMENTS INCORPORATED BY REFERENCE

None

 

 

 

 

 

 

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INDIA ECOMMERCE CORPORATION

FOR THE FISCAL YEAR ENDED

DECEMBER 31, 2014

INDEX TO FORM 10-K

 

 

 

 

 

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PART I

Note about Forward-Looking Statements

 

Certain statements in this report, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements may appear throughout this report, including without limitation, the following sections: "Business," "Management's Discussion and Analysis," and "Risk Factors." These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "intend," "strategy," "future," "opportunity," "plan," "may," "should," "will," "would," "will be," "will continue," "will likely result," and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. A detailed discussion of risks and uncertainties that could cause actual results and events to differ materially from such forward-looking statements is included in the section titled "Risk Factors" (Part I, Item 1A of this Form 10-K). We undertake no obligation to update or revise publicly any forward-looking statements, whether because of new information, future events, or otherwise.

 

Item 1   Business

Overview

 

India Ecommerce Corporation ("we," "our," "us," or "the Company") was incorporated on January 19, 2011 under the laws of the State of Nevada.

We are in the business of developing, promoting distribution, and managing television networks, television productions and ecommerce websites/mobile applications, targeting the India and the global Indian diaspora in both the consumer and business marketplace. Our goal is to push our television and online services into the marketplace in a quick and efficient manner to capture first mover advantages, to acquire a user/viewer/subscriber base from which we can build our proprietary ecommerce solutions.  

India is the world's second most populous country and is renowned for its high tech community, but still has yet to produce dominant ecommerce companies the likes of Amazon.com, Buy.com, or eBay. We feel that we will operate and thrive in an Indian online market that is still in its early stages, but is undergoing rapid growth. 

 

India Ecommerce Corporation launched the development of a number of websites in the third quarter, and all of these have experienced growth in unique visitors in the fourth quarter. Through a partnership with Jeffrey Martin Global Media, LLC, a TV production and management company, we have also begun operating under the brand name "uknowme."

Nyooz and HRelate

 

Both NyoozFlix.com and HRelate.com continued to gain in unique users in Q4. These websites will undergo major design changes in Q2 in 2015 to boost page views. There is continued interest in "Nyooz" branded TV productions, and those discussions are being led under our "uknowme" brand.

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Zootout

 

We ceased our development of a restaurant search engine because we have partnered with Zootout, an up and coming company in India in that space. We will aide Zootout with their technologies and functionality. Zootout will launch mobile apps for the iPhone, Android, and Windows throughout the second quarter of 2015.

ePerty

 

Technical work for ePerty.com is nearly complete. We are in the process to add a person who can manage and further develop the business model.

Television

 

We signed a contract to jointly manage television operations with Jeffrey Martin Global Media, LLC. This operation is set to launch in the first quarter of 2015, in three major markets in the United States. The joint venture is doing business as "uknowme." In following quarters, we will expand our reach to other television markets in the United States.

Third Party Marketing

 

Through partnerships, we will be marketing third party products and services both on television and online. We will launch this in the second quarter of 2015.

  

Research and Development

 

The core of our business model is to develop and modify websites for the Indian population. Websites need continuous attention and refinement. We plan to diversify our service offerings and develop mobile applications for each of our website properties.

 

We have begun developing mobile applications for each of our online projects, and expect to begin to launch these mobile applications in the second quarter of 2015.

Television also requires development. Our company will continue to raise capital to fund television property development.   

 

Intellectual Property

 

We have no patents or other protection for its intellectual property, and will rely on copyrights, trademarks, and corporate secrecy for protection for the foreseeable future.

 

Competition

 

The ecommerce market is highly competitive. It includes increasing competition from established companies who are expanding their production and marketing of performance products, as well as from frequent new entrants to the market. We will initially rely on the unique features and applications of our product to gain entrance to the marketplace.

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Employees

 

We want to maintain a small staff on our payroll so that we can be nimble. To accomplish this goal, we will employ contract employees for our initial projects and hire the best performing of these employees going forward. This allows us to avoid mistakes in filling up our human resource roster with underperforming employees.

We have identified top-level advertising salespeople in both the United States and in India which we can add to our team upon receiving funding. We view this as very important to our overall strategy. 

Recruiting top level personnel will be aided by share based compensation tied to overall performance. 

Executive cash compensation will be minimal due to their equity stakes with our Company. Key executive operations, such as Finance and Human Resources will be outsourced until a full time presence is necessary. 

Subsidiaries

We do not currently have any subsidiaries.

Item 1A    Risk Factors

 

Not required for a smaller reporting company.

 

Item 1B   Unresolved Staff Comments 

Not required for a smaller reporting company.

 

Item 2   Properties

We maintain our principal office at 1524 Rhine Street, Pittsburgh, PA 15212. Our telephone number is (412) 450-0028. We also have the option to lease more than 900 square feet of office space in Indore, Madhya Pradesh (India) for the research and development of our websites pursuant to a lease that our President entered into on our behalf.  We believe that our existing facilities are suitable and adequate to meet our current business requirements.

 

Item 3   Legal Proceedings

 

From time to time, we may become involved in various lawsuits and legal proceedings that arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings or claims that we believe will have, individually or in the aggregate, a material adverse effect on our business, financial condition or operating results.

 

Not applicable.

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PART II

Item 5   Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Our Common Stock is listed to trade in the over-the-counter securities market through the Financial Industry Regulatory Authority ("FINRA") Automated Quotation Bulletin Board System, under the symbol "IEEC".

The following table sets forth the quarterly high and low bid prices for our Common Stock during the last fiscal year, as reported by a Quarterly Trade and Quote Summary Report of the OTC Bulletin Board. The quotations reflect inter-dealer prices, without retail mark-up, markdown or commission, and may not necessarily represent actual transactions.

 

On April 7, 2015, the closing price for the common stock on the OTCQB was $0.005 per share.

Holders

 

As of December 31, 2014, we had 44 holders of our common stock. 

Dividend Policy

We have not declared or paid any cash dividends on our common stock or other securities and do not anticipate paying any cash dividends in the foreseeable future. Any future determination to pay cash dividends will be at the discretion of the board of directors and will be dependent upon our financial condition, results of operations, capital requirements, and such other factors as the board of directors deem relevant.

Equity Compensation Plan Information

None

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Recent Sales of Unregistered Securities

No unregistered securities were issued during the year ended December 31, 2013.

On September 5, 2014, and on October 5, 2014 the Company sold a total of 6,000,000 restricted common shares to two investors for $0.02 per share.

On October 7, 2014, the Company issued 250,000 of its restricted common shares to a consultant, for services rendered, at a cost of $0.041 per share charged to stock based consulting services.

On October 7, 2014, the Company issued 250,000 of its restricted common shares to a lender, as additional compensation, at a cost of $0.041 per share charged to interest expense.

On October 7, 2014, the Company issued 225,000 of its restricted common shares, to a lender, to fulfill the obligation to provide the lender with those shares if the loan was not repaid by January 11, 2013, which shares were previously recorded at a cost of $0.02 per share, charged to interest expense.

On October 17, 2014, the Company issued 1,000,000 of its restricted common shares, to a consultant, as partial payment, to reduce the total obligation under a consulting agreement from 5,000,000 to 4,000,000 restricted common shares.  The issued shares were expensed at $0.031 per share as sub-contractor expense.

On October 29, 2014 and on December 3, 2014, the Company issued 1,000,000 and 1,666,667 of its restricted common shares, to two consultants at a cost of $0.031 and $0.06 per share, as stock based consulting fees.

On December 30, 2014, the Company issued 250,000 of its restricted common shares to liquidate a note payable of $20,000 plus accrued interest of $717.55.

Use of Proceeds from Registered Securities

The Company is using the proceeds from the sale of its common stock to cover the expenses for general working capital purposes. 

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

None

 

Item 6   Selected Financial Data

Not required for smaller reporting companies.

 

Item 7   Management's Discussion and Analysis of Financial Condition and Results of Operations

We are in the business of developing, promoting and managing a multitude of ecommerce websites for the Indian market.

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Results of Operations

 

The following discussion of the financial condition and results of operations should be read in conjunction with the financial statements included herewith. This discussion should not be construed to imply that the results discussed herein will necessarily continue into the future, or that any conclusion reached herein will necessarily be indicative of actual operating results in the future.

 

For the years ended December 31, 2014 and 2013:

 

We did not generate any revenue during the period from January 19, 2011 (inception) to December 31, 2013.  During this stage, we were primarily focused on corporate organization, the initial public offering and the development of our business plan.

  

 

Liquidity and Capital Resources

 

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Going Concern

These financial statements do not include adjustments relating to the recoverability and classification of reported asset amounts or the amount and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company's continuation as a going concern is dependent upon its ability to obtain additional financing or sale of its common stock and ultimately to attain profitability.

Plan of Operations

 

Management's plan is to raise additional financing through a combination of equity and debt financing. Management believes this will be sufficient to finance the continuing development for the next twelve months. However, there is no assurance that the Company will be successful in raising such financing.

 

Summary of Significant Accounting Policies

 

Our financial statements and related public financial information are based on the application of accounting principles generally accepted in the United States ("GAAP"). GAAP requires the use of estimates; assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenues and expense amounts reported. These estimates can also affect supplemental information contained in our external disclosures including information regarding contingencies, risk and financial condition. We believe our use of estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively applied. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions. We continue to monitor significant estimates made during the preparation of our financial statements.  

 

Our significant accounting policies are summarized in Note 2 of our financial statements. While all these significant accounting policies impact our financial condition and results of operations, we view certain of these policies as critical. Policies determined to be critical are those policies that have the most significant impact on our financial statements and require management to use a greater degree of judgment and estimates. Actual results may differ from those estimates. Our management believes that given current facts and circumstances, it is unlikely that applying any other reasonable judgments or estimate methodologies would cause effect on our results of operations, financial position or liquidity for the periods presented in this report.

 

We believe the following critical accounting policies and procedures, among others, affect our more significant judgments and estimates used in the preparation of our financial statements:

Cash

Cash and cash equivalents consist primarily of cash on deposit, certificates of deposit, money market accounts, and investment grade commercial paper that are readily convertible into cash and purchased with original maturities of three months or less.

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Website Development

The Company capitalizes the costs associated with the development of its website.  Other costs related to the maintenance of the website are expensed as incurred.  Amortization will be provided over the estimated useful life of 3 years using the straight-line method for financial statement purposes.

Share Based Payments

The Company recognizes share-based compensation, including stock option grants, warrants and restricted stock grants at their fair value on the grant date. Share based payment awards issued to non-employees for services rendered are recorded at either the fair value of the services rendered or the fair value of the share-based payment, whichever is more readily determinable.  Compensation expense is generally recognized on a straight-line basis over the vesting period.  

Recent Accounting Pronouncements

There are no recent accounting pronouncements that are expected to have a material effect on the Company's financial statements.

 

Off Balance Sheet Arrangements

We do not have any off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as "special purpose entities" (SPEs).

Item 7A   Quantitative and Qualitative Disclosures About Market Risk

Not required for smaller reporting companies.

 

Item 8   Financial Statements and Supplementary Data 

See F-1.

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INDIA ECOMMERCE CORPORATION

REPORTS OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

AND

FINANCIAL STATEMENTS

For the Years Ended

December 31, 2014 and 2013

 

 

 

 

 

 

 

 

 

 

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TABLE OF CONTENTS

 

 

 

 

 

 

 

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To the Board of Directors

India Ecommerce Corporation

We have audited the accompanying balance sheet of India Ecommerce Corporation ("the Company") as of December 31, 2014, and the related statements of operations, stockholders' deficit and cash flows for the year then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.   

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion the financial statements referred to above present fairly, in all material respects, the financial position of India Ecommerce Corporation as of December 31, 2014, and the results of its operations and cash flows for the year then ended, in conformity with U.S. generally accepted accounting principles.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements, the Company has generated no revenue to date, has an accumulated deficit and is dependent on financial support from its shareholders, which raises substantial doubt about its ability to continue as a going concern. Management's plans concerning these matters are also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

 

 

 

 

 

 

 

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INDIA ECOMMERCE CORPORATION

BALANCE SHEETS

 

		December 31,				December 31,
		2014				2013
ASSETS
Current assets
Cash		$	10,713			$	19,675
Deposits			280				1,090
Prepaid expenses			27,625				-
Total current assets			38,618				20,765
Long term assets
Property and equipment, net			2,081				3,805
Total long term assets			2,081				3,805
Total assets		$	40,699			$	24,570
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities
Accounts payable and accrued liabilities		$	8,189			$	29,768
Notes payable			54,500				54,500
Total current liabilities			62,689				84,268
Note payable - long term portion			-				20,000
Total liabilities			62,689				104,268
Stockholders' deficit
Common stock $0.001 par value; 75,000,000 shares
authorized; 36,119,167 and 25,477,500 shares issued
outstanding, respectively			36,120				25,478
Additional paid-in capital			509,656				129,448
Accumulated deficit			(567,766	)			(234,625	)
Total stockholders' deficit			(21,990	)			(79,698	)
Total liabilities and stockholders' deficit		$	40,699			$	24,570

 

 

See accompanying notes to financial statements

 

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See accompanying notes to financial statements

 

 

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INDIA ECOMMERCE CORPORATION

STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

 

 

										Additional
		Common Stock								Paid-in				Accumulated
		Shares				Amount				Capital				Deficit				Total
Balance, December 31, 2012			25,477,500			$	25,478			$	129,408			$	(158,701	)		$	(3,815	)
Accrued interest waived by stockholders			-				-				40				-				40
Net loss for the year			-				-				-				(75,924	)			(75,924	)
Balance, December 31, 2013			25,477,500				25,478				129,448				(234,625	)			(79,699	)
Common shares issued for cash			6,000,000				6,000				114,000				-				120,000
Common shares and warrants issued for services			3,916,667				3,917				234,958				-				238,875
Common shares issued in satisfaction
of lender requirements			475,000				475				19,000				-				19,475
Common shares issued in satisfaction
of note payable			250,000				250				12,250				-				12,500
Net loss for the year			-				-				-				(333,141	)			(333,141	)
Balance, December 31, 2014			36,119,167			$	36,120			$	509,656			$	(567,766	)		$	(21,990	)

 

 

 

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NOTE 1 – DESCRIPTION OF BUSINESS

India Ecommerce Corporation (the "Company") was incorporated under the laws of the state of Nevada on January 19, 2011. The Company plans to build, promote and manage a multitude of ecommerce properties, in both website and mobile application formats, for the India market.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Management acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company's system of internal accounting control is designed to assure, among other items, that (1) recorded transactions are valid; (2) all valid transactions are recorded and (3) transactions are recorded in the period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the company for the respective periods being presented.

The Company's financial statements are prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States.  The Company has elected a December 31 fiscal year-end.

The preparation of financial statements in accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  A change in managements' estimates or assumptions could have a material impact on the Company's financial condition and results of operations during the period in which such changes occurred.

Actual results could differ from those estimates. The Company's financial statements reflect all adjustments that management believes are necessary for the fair presentation of their financial condition and results of operations for the periods presented.

For purposes of the statements of cash flows, cash equivalents include all highly liquid investments with original maturities of three months or less which are not securing any corporate obligations. The Company maintains its cash in bank deposit accounts, which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts.

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NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Deposits include a security deposit for office space located in Pittsburgh, PA.

 

Property and equipment are carried at cost. Expenditures for maintenance and repairs are charged against operations. Renewals and betterments that materially extend the life of the assets are capitalized. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in income for the period. The Company allocates 50% of its depreciation and amortization expenses to Cost of Sales.

Depreciation is computed for financial statement purposes on a straight-line basis over estimated useful lives of the related assets. The estimated useful lives of depreciable assets are:

 

The Company recognizes revenue for its professional services when persuasive evidence of an arrangement exists, performance of services has occurred, the sales price is fixed or determinable and collectability is probable.

 

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NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain.

The Company also follows the guidance related to accounting for income tax uncertainties. In accounting for uncertainty in income taxes, the Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more likely than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. No liability for unrecognized tax benefits was recorded as of December 31, 2014.

 

The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. A fair value hierarchy is used to prioritize the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined into the following three categories:

 

Level 1: Quoted market prices in active markets for identical assets or liabilities

Level 2: Observable market-based inputs or inputs that are corroborated by market data

Level 3: Unobservable inputs that are not corroborated by market data

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NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

The Company records stock-based compensation at fair value as of the date of grant and recognizes the corresponding expense over the requisite service period (usually the vesting period), utilizing the Black-Scholes option-pricing model. The volatility component of the calculation is based on the historic volatility of the Company's stock or the expected future volatility. The expected life assumption is primarily based on historical exercise patterns and employee post-vesting termination behavior. The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant.

Basic earnings per share are calculated dividing income available to common stockholders by the weighted average number of common shares outstanding.  Diluted earnings per share are based on the assumption that all dilutive convertible shares and stock options and warrants were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, warrants and options are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period.  There were 1,666,667 dilutive shares outstanding as of December 31, 2014.

On June 10, 2014, the Financial Accounting Standards Board ("FASB") issued update ASU 2014-10, Development Stage Entities (Topic 915). Amongst other things, the amendments in this update removed the definition of development stage entity from Topic 915, thereby removing the distinction between development stage entities and other reporting entities from US GAAP.  In addition, the amendments eliminate the requirements for development stage entities to (1) present inception-to-date information on the statements of income, cash flows and shareholders' equity, (2) label the financial statements as those of a development stage entity;  (3) disclose a description of the development stage activities in which the entity is engaged and (4) disclose in the first year in which the entity is no longer a development stage entity that in prior years it had been in the development stage.

The amendments are effective for annual reporting periods beginning after December 31, 2014 and interim reporting periods beginning after December 15, 2015, however entities are permitted to early adopt for any annual or interim reporting period for which the financial statements have yet to be issued.  The Company has elected to early adopt these amendments and accordingly have not labeled the financial statements as those of a development stage entity and have not presented inception-to-date information on the respective financial statements.

There are no other recent accounting pronouncements that are expected to have a material effect on the Company's financial statements.

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NOTE 3 – GOING CONCERN

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the recoverability of assets and the satisfaction of liabilities in the normal course of business. Since its inception, the Company has been engaged substantially in financing activities and developing its business plan and marketing. As a result, the Company incurred accumulated net losses through the year ended December 31, 2014 of $567,766. In addition, the Company's development activities since inception have been financially sustained through the sale of capital stock and capital contributions from a note holder.

 

The ability of the Company to continue as a going concern is dependent upon its ability to raise additional capital from the sale of common stock or through debt financing and, ultimately, the achievement of significant operating revenues. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.

NOTE 4 – PROPERTY AND EQUIPMENT

Property and equipment consisted of the following as of December 31, 2014 and 2013:

 

 

Depreciation expense included as a charge to income was $1,724 and $1,723 for the years ended December 31, 2014 and 2013, respectively.

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NOTE 5 – NOTES PAYABLE

The components of notes payable at December 31, 2014 and 2013 are summarized in the table below:

(1)

In the event of nonpayment, by January 11, 2013, lender is entitled to receive 225,000 common shares of capital stock.  As the loan was not paid off as of the maturity date, the Company issued 225,000 shares of common stock on October 7, 2014.

(2)

The Company may draw and repay the line of credit up to an outstanding of $25,000. On December 30, 2014, the full amount of principal and interest of the outstanding line of credit of $20,711 was paid through the issuance of 250,000 shares of common stock of the Company valued at $12,500. The fair value of the stock was $0.05 and was based on the trading price per share of the Company on the date of issuance. As such, the Company recognized a gain on settlement of debt upon issuance of $8,211.

(3)

Payment is guaranteed by the promise to issue 500,000 common shares of the Company's common stock.

(4)

The note bore interest at a rate of 8% per annum, was unsecured and had a maturity date on December 5, 2014. The note was convertible into common stock in whole or in part at a variable conversion price equal to a 45% discount to average of the lowest three trading prices for the common stock during the 10 trading  day period ending on the latest complete trading day prior to the conversion date. The Company recorded a discount in the amount of $32,500 in connection with the initial valuation of the beneficial conversion feature of the notes to be amortized utilizing the interest method of accretion over the term of the notes.

 

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NOTE 5 – NOTES PAYABLE (CONTINUED)

(4)

Continued – We have determined that the conversion feature of the note is not considered to be solely indexed to our own stock and is therefore not afforded equity treatment. In accordance with ASC 815, we have bifurcated the conversion feature of the notes and recorded a derivative liability. The value of the derivative liability recorded at note origination was $45,926. The Company paid off the note, all accrued interest, as well as a $16,250 prepayment as of December 31, 2014.

NOTE 6 – STOCKHOLDERS' DEFICIT

The total number of common shares authorized that may be issued by the Company is 75,000,000 shares with a par value of $0.001 per share. There are no preferred shares authorized to be issued.  There were 36,119,167 and 25,477,500 shares of common stock issued and outstanding at December 31, 2014 and 2013, respectively.

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NOTE 7 – STOCK PURCHASE WARRANTS

During the year ended December 31, 2014, the Company issued 1,666,667 warrants to creditors to acquire its common stock. In applying the Black-Scholes options pricing model to the options and warrant grants, the fair value of our share-based awards granted were estimated using the following assumptions for the periods indicated below:

A summary of the status of the Company's stock options as of December 31, 2014 and changes during the periods ended December 31, 2014 and 2013 is presented below:

The following table summarizes information about options and warrants as of December 31, 2014:

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NOTE 8 – INCOME TAXES

Net deferred tax assets consist of the following components:

The income tax provision differs from the amount of income tax determined by applying the U.S. federal and state income statutory tax rates to pretax income (loss) from continuing operations as follows:

 

 

 

 

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NOTE 9 – LEASES

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None.

 

Item 9A   Controls and Procedures 

Management's Report on Disclosure Controls and Procedures

 

Disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act"), are our controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Act is accumulated and communicated to our management to allow timely decisions regarding required disclosure.  Rules 13a-15(b) and 15d-15(b) under the Exchange Act, requires us to carry out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2014.  This evaluation was implemented under the supervision and with the participation of our officers and directors.

Based on this evaluation, management concluded that, as of December 31, 2014, our disclosure controls and procedures are ineffective in ensuring that information required to be disclosed in our Exchange Act reports is (1) recorded, processed, summarized and reported in a timely manner and (2) accumulated and communicated to our management to allow timely decisions regarding required disclosure.

 

Our officers and directors have concluded that our disclosure controls and procedures had the following material weaknesses:

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To the extent reasonably possible given our limited resources, we intend to take measures to cure the aforementioned weaknesses, including, but not limited to, the following:

Since the recited remedial actions will require that we hire or engage additional personnel, these material weaknesses may not be overcome in the near-term due to our limited financial resources. Until such remedial actions can be realized, we will continue to rely on the limited advice of outside professionals and consultants.  These initiatives will be subject to our ability to obtain sufficient future financing and subject to our ability to start generating revenue.

Management's Annual Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act.  Our internal control system was designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation and fair presentation of our financial statements for external purposes in accordance with generally accepted accounting principles.  Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our officers have assessed the effectiveness of our internal controls over financial reporting as of December 31, 2014.  In making this assessment, management used the criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based upon its assessment, management concluded that, as of December 31, 2014, our internal control over financial reporting was ineffective.

Management has identified a lack of sufficient personnel in the accounting function due to our limited resources with appropriate skills, training and experience to perform the review processes to ensure the complete and proper application of generally accepted accounting principles.  We are in the process of developing and implementing remediation plans to address our material weaknesses in our internal controls.

Management has identified specific remedial actions to address the material weaknesses described above:

  

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Due to its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

This Annual Report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by our registered public accounting firm pursuant to an exemption for smaller reporting companies under Section 989G of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

Changes in Internal Control over Financial Reporting

During the fourth quarter ended December 31, 2014, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B   Other Information

All inventions and intellectual property developed during Consultant's and Company's participation in this project will become the property of our Company.

On January 21, 2015, Rohit Gangwal submitted his resignation as treasurer and director, to be effective January 31, 2015, to enable him to participate more fully in other interests.  He had no disagreement with the Company or other members of the Board of Directors and will continue to manage operations for websites and will also continue to be the Company technical advisor.

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 PART III

 

 

Item 10   Directors, Executive Officers and Corporate Governance

 

Below are the names and certain information regarding our executive officers and directors during the year ended December 31, 2014.

 

  

The biographies of each of the officer and directors are listed below and contain information regarding the person's service as a director, business experience, public company director positions currently held or held at any time during the last five years, information regarding involvement in certain legal or administrative proceedings, if applicable, and the experiences, qualifications, attributes or skills that caused the Board to determine that the person should serve as a director in light of our business and structure.

Ashish Badjatia is the Company's President, Chief Executive and Financial Officer, Secretary and Director and is responsible for the day to day management of our Company, administrative functions, corporate filings and strategic evolution of its business. Mr. Badjatia devotes part time, 20 hours per week, to the business of IEC, with minimal external commitments. His other business commitments are related to a social media company, which we do not believe to be competitive with the business of IEC.  Mr. Badjatia brings over 18 years of a wide array of experiences ranging from social networking, international trade, global investment banking, outsourcing, proposal management, and entrepreneurship. Mr. Badjatia holds a Bachelor of Business Administration from the Williamson School of Management at Youngstown State University, and a Master of International Affairs (International Business & Finance and South Asian Affairs) from the School of International and Public Affairs at Columbia University. Additionally, he has taken executive coursework for Venture Capital and Private Equity at the Indian School of Business. In the past, Mr. Badjatia has served on the Board of the India Ohio Chamber of Commerce.  Mr. Badjatia's work experience includes the following:

 

 

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Rohit Gangwal is the Company's Treasurer and Director.  Mr. Gangwal devotes part time, 20 hours per week, to the business of IEC, with minimal external commitments. His other business commitments include creating software for American and Indian clients, as well as basic websites that do not have ecommerce transactional functions.  We do not believe that these other business activities are competitive with the business of IEC.  Mr. Gangwal spends a majority of his time in the United States, but also occasionally works out of our office in India.  Mr. Gangwal has over 10 years of experience in the IT industry in Software Development, Web Application Development, Content Management, and Project Management. He is the founder of software development and IT consulting companies Covetus LLC, USA and Covetus Technologies Pvt. Ltd. India. (www.covetus.com), a leading technical innovator in software and web application development based in Dallas, Texas and Indore (MP), India with additional offices in Charlotte, North Carolina and Ujjain (MP), India. Before starting Covetus in 2005 Mr. Gangwal worked with various Companies in USA (John Deere, Verizon, Wolter Kluwer, Northwest Airlines, etc) and provided IT consulting services to various other US based Clients. Mr. Gangwal holds Master in Computer Science and Management from Devi Ahilya University, Indore, India and Masters in Computer Science from LAMARUniversity Beaumont, Texas.  Mr. Gangwal's work experience includes the following:

Directors

Our bylaws authorize no less than one (1) director. We currently have two directors.  It is the Company's intention to replace Mr. Gangwal, who resigned effective January 31, 2015 during the second quarter of 2015.

Term of Office

Our directors are appointed for a one-year term to hold office until the next annual meeting of our shareholders or until removed from office in accordance with our bylaws.  Our executive officers are appointed by our board of directors and hold office until removed by the board.

Family Relationships

There are no family relationships among our officer and directors.

Board of Director Committees

We do not have any board committees due to the limited size of the Board and the Company, and as such the board as a whole carries out the functions of audit, nominating and compensation committees.

Compliance with Section 16(a) of the Exchange Act

Not applicable.

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Advisory Board

 

In addition to its board of directors, the Company also has an informal "Advisory Board".  The members of the Advisory Board are uncompensated and have no official power or standing with the Company; they are available to provide advice to the Company upon request.  Advice is requested either by email or by telephone.  Only our officers and directors are permitted to request advice from the Advisory Board.

 

Andrew Bachman is co-Founder and President of Tatto Media.  Mr. Bachman is also the Co-founder of Adapp Solutions, which creates applications for online advertising companies.  Mr. Bachman Bachman is on the Advisory Board because of his demonstrated ability to market websites successfully, and his overall knowledge of online advertising. These will be key factors in promoting the websites that India Ecommerce Corporation will develop.

 

Sridhar Ganesan has 25 years of experience in Media, Telecom & Technology industries - developing/building businesses and organizations, raising capital from private and public markets, and managing operations during challenging times. As CFO of satellite radio provider WorldSpace, Sridhar participated in the Company's initial public offering and other financings.   Mr. Ganesan has published over 300 news and analytical business/economic articles in India and has managed a sales/distribution network team for newspapers.  Mr. Ganesan has been selected to be on the Advisory Board due to his as a former Chief Financial Officer for a NASDAQ listed company. Additionally, Mr. Ganesan has strong personal connections in the business community in India.

 

Christos Manuel is the founder of goCruso.com, a social networking website for the US restaurant and hospitality industries. Mr. Manuel formulated the strategy of goCruso for raising capital, recruitment of team members, and strategic partnerships, and also managed the development of the goCruso.com website. Mr. Manuel has been selected to be on the Advisory Board due to his experiences in development of social media technologies.

 

Minesh Shah has over 4 years of experience in information technology industry from engineering large scale web-based portals to complex information technology applications at SP Technolab.  Mr. Shah has experience with Internet Marketing, Social Media and Search Engine Optimization.  Mr. Shah is listed on our Advisory Board because of his expertise with website development in India.  

  

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Item 11   Executive Compensation

The following table sets forth the compensation paid to our officers and directors for the years ended December 31, 2013 and 2014:

 

 

 

Employment Agreements

 

On January 1, 2014 the Company entered into a twelve month employment agreement with its President, Chief Executive and Financial Officer, Secretary and Director to "facilitate everyday management of the Company.  The agreement requires payment of salary of $2,000 per month and is automatically renewable for one year increments unless canceled by either party.

 

Director Compensation

 

None

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Equity Compensation Plans

The following table set forth information regarding the outstanding equity awards as of December 31, 2014 for our officers and directors:

Item 12   Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The following table sets forth certain information regarding beneficial ownership of our common stock as of December 31, 2013.

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⁽¹⁾ Andrew Bachman is the natural person who exercises voting and/or dispositive powers over the common stock owned by Shaboom Media.

As used in this table, "beneficial ownership" means the sole or shared power to vote, or to direct the voting of, a security, or the sole or shared investment power with respect to a security (i.e., the power to dispose of, or to direct the disposition of, a security). In   addition, for purposes of this table, a person is deemed, as of any date, to have "beneficial ownership" of any security that such person has the right to acquire within 60 days after such date.

Other than the shareholders listed above, we know of no other person who is the beneficial owner of more than five percent (5%) of our common stock.

The persons named above have full voting and investment power with respect to the shares indicated.  Under the rules of the Securities and Exchange Commission, a person (or group of persons) is deemed to be a "beneficial owner" of a security if he or she, directly or indirectly, has or shares the power to vote or to direct the voting of such security, or the power to dispose of or to direct the disposition of such security.  Accordingly, more than one person may be deemed to be a beneficial owner of the same security. A person is also deemed to be a beneficial owner of any security, which that person has the right to acquire within 60 days, such as options or warrants to purchase our common stock.

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We currently operate with two directors, Ashish Badjatia and Rohit Gangwal. We have determined that neither of our directors is an "independent director" as defined in NASDAQ Marketplace Rule 4200(a)(15).

Item 14   Principal Accounting Fees and Services

The fees billed for professional services rendered by our principal accountant are as follows:

 

 

Pre-Approval Policies and Procedures

The board of directors must pre-approve any use of our independent accountants for any non-audit services.  All services of our auditors are approved by our whole board and are subject to review by our whole board.

PART IV

 

Item 15   Exhibits, Financial Statement Schedules

                      

 

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

 

 

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